HP's recently appointed chief executive Léo Apotheker is already feeling the heat after a disappointing first-quarter performance gave investors the heebie-jeebies.
For the three months to the end of January, the vendor's sales grew four per cent on the corresponding period last year to $32.3bn (£19.9bn), while GAAP net earnings rose 16 per cent to $2.6bn. The figures fell below Wall Street expectations and HP's stock price dropped 12 per cent in after-hours trading last night.
The decline is also attributable to the vendor lowering its full-year revenue forecast. It now expects to post an FY11 top line of $130bn to $131.5bn, down from an earlier prediction of $132bn to $133.5bn.
Revenue for HP's Personal Systems Group declined one per cent annually during Q1. This was entirely down to sales of consumer systems plummeting 12 per cent. Services sales also suffered during the quarter, posting a two per cent year-on-year decline. This was attributed to a dearth of short-term value-added services contracts.
In a conference call with investors, transcribed by Seeking Alpha, Apotheker, who joined at the start of the quarter, accepted his firm had dropped the ball in Q1.
"We need to do a much better job in our higher value-added services," he said. "And, what is apparent in Q1, is that we have some work to do. We need to do a better job in selling short-term value-added projects into our installed base."
Sales in HP's Software, Imaging and Printing and Financial Services divisions fared better in Q1, posting annual rises of five, seven and 15 per cent, respectively. The Enterprise Storage, Servers and Networking unit was the quarter's star performer, boosting turnover by 22 per cent.
Contingency plans follow Carillion's demise earlier this year
Oliver Tuszik says partners can boost subscription sales by taking a customer experience-led approach
Firm says enterprise business has performed 'weaker than originally expected'
Top executives from nine VARs, including Computacenter, Bell Integration, XMA, ANS and Epaton, weigh in on which server, storage and networking technologies will be red hot next year